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Price Signal Summary - EURUSD Pullback Considered Corrective

OUTLOOK
  • In FX, Friday’s rally in EURUSD resulted in a break of resistance at 1.0870, the Jul 25 / 29 high. Monday’s gains marked an extension of Friday's move and this resulted in a break of key short-term resistance and the bull trigger at 1.0948, the Jul 17 high. The climb resumes the uptrend and opens 1.1012 next, 76.4% of the Dec 28 ‘23 - Apr 16 downleg. Key short-term support has been defined at 1.0778, last Thursday’s low. A pullback is considered corrective.
  • GBPUSD remains in a bear-mode condition. Last week’s move down resulted in a break of the 50-day EMA - at 1.2790 - and a breach of a trendline at 1.2771, drawn from the Apr 22 low. The clear break of the EMA and the trendline, suggests scope for an extension towards 1.2672 next, 50.0 of the Apr 22 - Jul 17 bull cycle. On the upside, initial resistance to watch is at 1.2838, the 20-day EMA.
  • USDJPY remains bearish and last week’s sell-off, plus Monday’s impulsive move lower, reinforces this condition. This paves the way for an extension towards the next key support at 140.25, the Dec 28 ‘23 low. Note that the pair is in an extreme oversold condition, however a clear reversal pattern / signal in price is required to highlight a change in direction. Initial resistance is seen at 146.66, the Aug 5 high.
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